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Ripoff Alert: Senate Probes “Post Transaction Marketing,” Other Dubious Web Sales Practices; UNTD, VPRT Slide

Eric Savitz

Several Internet stocks are taking some heat this morning following the release yesterday of a Senate report on aggressive sales tactics on the Web–and in particular singling out for scorn a practice known as “post-transaction marketing.”

The report, issued by the Senate Committee on Commerce, Science and Transportation, asserts that three Connecticut-based direct marketing companies–Affinion (which is owned by Apollo Management), Vertrue (which is owned by investors One Equity Partners, Rho Ventures and Brencourt Advisors as well as members of management) and Webloyalty–and their e-commerce partners have together raked in over $1.4 billion in revenue “by using aggressive tactics to charge Internet shoppers for club membership programs.”

These guys are responsible for the stream of offers you get for trials in membership clubs, “cash back,” and other services when you are buying movie tickets, airline tickets, flowers or others goods on the Web.

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